Nike, Costco and Macy’s: Customer Relationship Management

Subject: Marketing
Pages: 5
Words: 1459
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6 min
Study level: PhD

Nike Inc. is among the leading Fortune 500 companies in the United States (Larson 2). It is a publicly-traded company that enjoys robust market share and sales of its products in the global market. It primarily supplies apparel and athletic wear. In addition, the company manufactures sports equipment of different varieties according to the dynamic needs of the market. Before the close of 2008, the company was already recording over US$ 18.6 billion in terms of annual sales. Besides, it has a large and diverse workforce of over 30,000 employees spread across the world (Larson 5).

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As it stands now, marketing is the key operating platform for Nike Inc. This implies that Customer Relationship Management (CRM) is valued by the management of the company. CRM entails a strategy or system of reaching out and managing both current and future customers of an organization. Besides, CRM seeks to establish the needs of customers based on their tastes and preferences (Levy and Weitz 76). In order to record and sustain a high volume of sales, Nike Inc. invests heavily in CRM activities.

When compared to Macy’s Inc. and Costco, it is the only company that employs various brands in marketing its products. Some of the brands used include Nike Skateboarding, Air Jordan, Nike+, Nike Pro, and Nike Golf. Besides, it uses its own brand name to reach out to the target market. However, Nike’s CRM is broader than just branding. For instance, all faulty products circulating in the market are usually called back once customers give their feedbacks (Larson 11). Macy’s and Costco have no records of recalling back unwanted products. However, Nike, Macy’s, and Costco demonstrate a high level of commitment to CRM in order to satisfy the tastes and preferences of consumers.

Advertising campaigns and swoosh emblems are among the outreach strategies employed by Nike inc. as part of automating its sales force. For example, there are well-established call centers where customers can make inquiries. In addition, coordination of sales and frequent monitoring of customers’ account histories are among the CRM activities put in place by Nike. By tracking the purchasing accounts of customers who buy regularly from the company, the management at Nike is in a position to make necessary follow-ups and adjust its offerings according to the desires of clients. Sales promotion analysis is also carried out under the above CRM exercises (Kang and Hustvedt 257).

Blogs and other numerous social networking sites (such as Twitter and Facebook) are instrumental for Nike when it comes to Customer Relationship Management. Such sites are not just used to market the company’s products. They are also vital in obtaining the views, reviews, comments, and general concerns of customers and the public at large. Macy’s and Costco also use social media in their CRM activities. However, they are poorly monitored. Sometimes, it might take too long before customers receive feedbacks. Monitoring conversations is a crucial parameter when CRM is executed through social media sites. Since Nike Inc. is still a giant manufacturer of sneakers used in sports, the company is keen on innovating better ways of producing goods that can outwit market competition. The Joga Bonito is one of the social media sites used by Nike to interact with customers. A video clip posted by Nike on a social media site was viewed by close to 10 million people (Kang and Hustvedt 256). By offering inspiring products, Nike Inc. has attained the highest level of service delivery. There is a growing pool of loyal customers across the globe since Nike’s CRM has managed to create and sustain positive relationships between customers and the company.

Costco is among the leading warehouse club chains in North America. It is a mass merchandiser in the retail business and deals with wine and furniture among other household products (Corona and Altamirano 85). During the 1990s, the chain store expanded rapidly to almost double its original size. This followed the difficult financial years of the 1980s. Although the origin of the chain store can be traced back to the 1950s, Customer Relationship Management (CRM) has been part and parcel of its growth agenda.

The leveraged buyout of Costco Plus that took place in 1987 witnessed the beginning of the financial resurgence of the company. The management of the chain store decided to start offering mixed merchandise to customers instead of single-line products. Nike also differentiates its products so that it can obtain several feedbacks as possible from customers. Altering merchandise mix that took place in the early 1990s was due to robust market research. Views from consumers were obtained during the research study of the US market. Under the new management, the company instituted several changes with the aim of turning around the operations of the store. A similar management platform is evident at Macy’s Inc.

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In order to determine the best products that can easily attract customers, the management of the chain store has been continually running marketing campaigns in both print and electronic media. It can be recalled that such campaigns began when Dillon took over as the head of the chain store. Focus groups have been very instrumental in assessing market information for Costco. Several experiments have also been carried out using selected focus groups. After the research studies, Costco established that gourmet food and a mix of home décor merchandise were the main products required by customers aged between 25 and 55 years (Corona and Altamirano 89). As a result, beverages, jewelry, and home décor items were increased in the chain store while items such as toys and numerous varieties of children’s products were gradually reduced from the counters. The management also found it appropriate to reduce the mean square footage of the building housing the store. The minimized space of the retail store was compensated by the vertical arrangement of goods. This system of arranging products has been embraced and adopted across all major Costco stores.

Stocking important items is a priority area for Costco. This might not be the best practice in the retail industry since product differentiation can hardly be attained. The management of the chain store has realized that Customer Relationship Management (CRM) cannot be enhanced if important items are not available for purchasing. The fact that space availability for merchandise is a real threat for Costco explains why the chain store should only stock products that are frequently bought by customers. Finance data support is also available in current Costco’s CRM system. The record of accomplishment of customers can be viewed and analyzed through the integration of technology. The implementation of a robust CRM structure has led to the robust growth of the chain store. A 100 percent rise in revenue was recorded between 1992 and 1997. Besides, the net income margin has been improving substantially over the years.

Macy’s is a renowned Federated Department Store in the United States. Some economic pundits argue that Macy’s Inc. has been a household name for several decades (Campanelli par. 3). It is among the premier retailers in North America with its headquarters in New York and Cincinnati. It runs over 800 stores in the United States. Macy’s Inc. is among the Federated Stores that has adopted an aggressive Customer Relationship Management (CRM) system.

The store aims to improve its interaction standard with customers. As a result, it recently adopted outbound marketing with the help of SSA Global in order to improve or enhance public relations affairs between the store and customers. The store has a purchasing platform at Macys.com through which customers can buy and pay for their products in a virtual environment. Both Nike and Costco have not embraced outbound marketing in their CRM.

The interaction portal is made up of a support transaction system and a software license product. Through this software, the management of the store is in a position to execute intelligent interaction with customers who purchase products via Macys.com (Campanelli par. 6). This type of interaction has also been personalized in the sense that customers can gain a sense of concern and human touch during the interaction process unlike the case of Nike Inc.

The store has been able to improve its return on investment ever since SSA Outbound Marketing was implemented some years ago. In addition, the brand image of the store has been strengthened owing to the online marketing programs. Other benefits of the SSA customer relationship management include improved client insight and analytics as well as closed-loop campaign management. Customers can now be addressed in a more focused style. In other words, individualized attention to customers is guaranteed through the SSA outbound marketing portal. Moreover, this tool is a vital marketing solution for an integrated database. The management at Macy’s can use the software to implement and appraise permission-based marketing campaigns.

Works Cited

Campanelli, Melissa. Macys.com Picks SSA Global for CRM. 2006. Web.

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Corona, Ramon, and Nelson Altamirano. “Is The Treasure Hunt Strategy Working For Costco?” International Journal of Management & Marketing Research (IJMMR) 3.3 (2010): 83-93. Print.

Kang, Jiyun, and Gwendolyn Hustvedt. “Building Trust Between Consumers And Corporations: The Role Of Consumer Perceptions Of Transparency And Social Responsibility.” Journal Of Business Ethics 125.2 (2014): 253-265. Print.

Larson, Deanne. “Global Brand Management — Nike’s Global Brand.” ISM Journal of International Business 1.3 (2011): 1-14. Print.

Levy, Michael, and Barton Weitz. Retailing Management. New York: McGraw-Hill/Irwin, 2013. Print.